Cingular and CTIA and General and SprintNextel and T-Mobile and Verizon Wireless
Ashley on 12 Apr 2007 04:14 pm
Some people just can’t get a break.
At their LA show last September, CTIA announced the launch of the Text 2Help initiative. Text 2Help allows customers of participating carriers (Alltel, AT&T, Boost, Dobson, Sprint, T-Mobile, and Verizon Wireless) to donate $5 to the Red Cross in natural disasters just by texting the word “GIVE” to the number “2HELP.” A $5 charge is added to the customer’s next wireless bill, and 100% of the donations go to the Red Cross for use in disasters like Katrina.
Sounds good, right? A little corporate philanthropy going a long way for a good cause…
Not according to the Foundation for Taxpayer and Consumer Rights. FTCR has written a letter condemning the program as a profit scheme masquerading as a fundraiser devised by the carriers, based on the fact that standard text messaging fees still apply for all donations (although some have apparently waived the fees). The New York Times picked up the story yesterday, adding some unfortunate negative publicity to the program.
Should the carriers have waived fees associated with donating to a charitable organization? Probably. But I think FTCR is missing the point here.
Say 200,000 people were to donate $5 each through Text 2Help in the aftermath of the next major natural disaster. That would yield $1 million for the Red Cross. At roughly 10 cents per text, the seven carriers would make a collective profit of $2000 from the text messages, averaging less than $300 each. (That is assuming that people have not purchased unlimited texting plans, which many have.) SMS revenues for 2006 were
$15.2 billion $5.6 billion. Text 2HELP revenues are just a drop in the proverbial hurricane for the carriers, and it is a shame that such a worthwhile program should attract such criticism simply becaue it was launched by the carriers.
Update: This post has been edited.
Full Disclosure on the dish: Our firm represents CTIA, Verizon Wireless, and AT&T.